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Dear RealTraders,
In this vein, that might explain why some commodity trading advisors hire
marketing and administrative people to run client communications and leave the
traders strictly to trading. Just because someone trades really well doesn't
mean they can run a full flung money management business by themselves - those
are two totally different things and require different sets of skills and
personalities.
I recall hearing a story about Richard Dennis in the early 1980s - one of his
clients called him up one day to complain why his accounts weren't in a recent
runup in crude. Talk about second guessing! Not only did Dennis close the
account that day, but he rarely, if ever, talks to clients anymore. He's got a
bunch of competent people to do that now.
Strupp
wallst wrote:
> Really think twice before you start managing money for someone else. I
> tried to do this a few years back and it was one of the most difficult
> things to do, and im not talking about the managing of the money, the
> customers and clients can be VERY difficult to work with and can add a
> tremendous amount of pressure on your trading. In the end I just shut it
> down and gave everybody back their money. It wasn't worth the hassle. I
> think Marty Schwartz talked about the same thing in his book Pit Bull. It
> goes back to the thing where when your the hero everybody loves you, but
> once it goes the other way, then every ten mins the phone will be ringing,
> asking what is going on. This is not to say that it shouldn't be done. I
> think with the right mix of client and methodology, it can be very
> successful. But just remember that its one thing to trade for yourself and
> all you have to do is worry about yourself. Its another thing to trade for
> a group of different persoanlities, Keeping records for each and everyone of
> them, trying to explain everything you do(What do you mean we got stopped
> out?). Im not sure what your real motivation would be for starting one,
> just make sure that you really know what your getting into before you do it.
>
> Troy
> wallst@xxxxxxxx
> ----- Original Message -----
> From: Levent Erbora <erbora@xxxxxxxxxxxxx>
> To: <realtraders@xxxxxxxxxxxxxxx>
> Sent: Saturday, March 25, 2000 11:28 PM
> Subject: [RT] Managing Money
>
> >
> > What would be the best type of business entity to form for investing and
> managing a few other people's money?
> > A limited partnership? A "limited liability corp. (LLC)" maybe? Something
> else?
> > What would be the pros & cons for the above?
> > The number of investors would probably be less than 10, and the funds
> would mainly be invested/traded in the stock market (no
> futures/commodities).
> > Also, what would be the typical or generally accepted fee structure/profit
> sharing arrangement between the investors and the money manager?
> >
> > Any and all advise, insights and pointers will be greatly appreciated.
> >
> > Thanks in advance for your time.
> >
> > Best regards,
> >
> > Levent Erbora
> >
> >
> >
> >
> >
> >
> >
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